Iqbal Latif

http://www.cybermusings.blogspot.com

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    • Dollar Doldrums Will Soon Be History - Barron's [view article]
      Just came from Spain, the sub prime crisis in Spain is totally hidden, Barcelon suburbun cities have thousands and thousands of vacant homes..

      There is blood bath in property valuation, Germany industrial production is suffering acutely, Euro rates sooern rather than later will have to be cut.       Apr 27 06:31 PM
    • These Market Internals Make It Hard To Be a Bear [view article]
      It is always good to sell something you don’t own, forget about futures that big players use all the time even smaller players have the luxury of a short with ETF’s like SDS and DXD, SRS all these are ultra short products and provide necessary juice of liquidity in a down turn a long portfolio can be shorted in no time without losing out any long position. The very availability of these instruments have kind of acted as a bottom under the market, in presence of wide variety of short instruments the internal strengths of the markets is a very important indicator rising internal moving averages indicate that a short term bottom is in place, .. $/Yen is stabilising - one needs to look at the carry trade, if carry trade is back in play we will have a move Above 12600 Apr 08 05:55 AM
    • These Market Internals Make It Hard To Be a Bear [view article]
      It is always good to sell something you don’t own, forget about futures that big players use all the time even smaller players have the luxury of a short with ETF’s like SDS and DXD, SRS all these are ultra short products and provide necessary juice of liquidity in a down turn a long portfolio can be shorted in no time without losing out any long position. The very availability of these instruments have kind of acted as a bottom under the market, in presence of wide variety of short instruments the internal strengths of the markets is a very important indicator rising internal moving averages indicate that a short term bottom is in place, .. $/Yen is stabilising - one needs to look at the carry trade, if carry trade is back in play we will have a move Above 12600 Apr 08 05:55 AM
    • The End of U.S. Investing as We Know It? [view article]
      Morgan Stanley's first-quarter net earnings dropped 42% as revenue also fell, the investment bank said Wednesday.

      However, the results for the three months ended Feb. 29 beat consensus forecasts that have been knocked down by credit fears.

      The glass is not completely empty in 2008. In fact, it may actually be half-full.



      The company reported income of $1.56 billion, or $1.45 a share, compared with $2.67 billion, or $2.51 a share, earned in the year-earlier first quarter. Net revenue fell 17% to $8.32 billion, the company said.

      Analysts had, on average, forecast a quarterly profit of $1.03 a share as well as revenue of $7.19 billion.

      Morgan Stanley said net income included the results of Discover Financial Services and Quilter Holdings Ltd., which were reported as discontinued operations.

      Morgan Stanley took mortgage-related trading net write-downs totaling $1.2 billion during the latest quarter. Additionally, it booked net losses of $1.1 billion tied to marking down the value of loans as well as closed and pipeline commitments.

      Investment-banking revenue was $980 million, which included advisory revenue that rose 19% from a year ago to $444 million, Morgan Stanley said.

      The company said its asset-management business faced "challenging market conditions" punctuated by losses in real estate and structured investment vehicles, resulting in quarterly losses of $161 million before taxes.

      "Despite turbulent markets, Morgan Stanley achieved strong performance across man y of our businesses," said Chief Executive John Mack in the company's earnings release.

      "While many of our businesses are facing challenging market conditions that we expect to continue in the months ahead, we are satisfied with how Morgan Stanley navigated the ongoing market turbulence," the CEO added.

      The company also said Morgan Stanley's board approved the appointment of a new chief risk officer, Ken deRegt.

      The co mpany said it has not bought back any stock so far this fiscal year.

      Morgan Stanley's shares rose more than 17% during Tuesday's market rally, sparked in part by the latest Federal Reserve interest-rate cut.

      Also Tuesday, Lehman Brothers Holdings Inc. and Goldman Sachs Group Inc. both reported quarterly profits that declined more than 50%. However, both sets of results came in ahead of expectations. See full story.       Mar 19 08:30 AM
    • The End of U.S. Investing as We Know It? [view article]
      Bull and Bear the lines are blurred...

      The instruments of short are far more lethal than instruments that help you go long. The capacity of ultra shorts like SDS, DXD to draw last ounce of blood left in the bulls is immense. A bull is a bear at the same time. Those who in this august thread feel that a bull is never a bear fail to comprehend that GS made its monies from short on ABS.

      A week last 'Tuesday sophistication of bull-bear relationship can be well imagined that a hedge fund that bought huge qty of 40 puts on BSC was borrowing from BSC to short them. Imagine borrowing a stiletto from the lover to plunge in the heart of your lover.

      GS and LEH earnings yesterday should have been much worse after 9 months of continuous bleeding of the financial sector.

      XHB, XLF have suffered immensely to the extent that as if US economy is in depression not even a severe recession. The illiquidity of the CDO’s, ABS and CMBS kind of paper is deeply discounted; all this is sign of capitulation where market news takes far higher toll than it is warranted but that very selling is what differentiates USA from Japan, where inaction can help linger a problem whereas ask question later shoot first led the fed to sell BSC at 2$’s to JPM, later on it was evident that the price was far lower than what shareholders expected or deserved, in this kind of environment the snap back rally of yesterday was just a sweet reminder that how low and badly markets have been discounted.

      Commodities are higher for a reason, it is not that demand and consumerism globally have fallen off the peak, depression and disasters also recessions everyone loves are based on falling demand, commodity prices are high because a full 1 billion middle class consumers have added on to the global scene from Latin Americas to India to China. BRICS are the countries who are commodity rich, and need lot of infrastructure development; they are loaded and ready to spend on basic amenities like power houses, roads and health. The master economies of the world and mature companies are set to take advantage, lower $ would mean they are more competitive than Europe.

      Rising consumerism benefits USA the most, MCD’s, Starbucks and Pizza Huts are products that these new billon consumers will add on to their diet, unhealthy it may be but ‘in’ it is. This is considered as a sign of affluence.

      A decade ago Greenspan use to worry about USA as oasis of stability, the speech of irrational exuberance also contained that USA cannot be the last banker of resort to everyone from LTCM, to USSR to Latin America or Asian debt contagion. Today most of these sick economies are great possible customers of mature economies, we are at a cusp of huge move forward, the pessimists will keep distorting the mantra and demanding ‘death dance’ and full capitulation, however one thing only will decide the fate of the markets or recession or death of $, is new consumerism and new commodity rich countries part of the global free trade or they are behind the Iron curtain, hte one thing I am sure about h
      Is that these new consumers are very much a part of the scene and are looking ot buy on GOOG, but latest INTC 6th generation chips and are avid users of face book and all that is western produced, the best advice they get for their infrastructure development is from likes of BSC and GS or LEH, mark my words that bull is a bear and bear is a bull, those who will not be able to change colours and tie themselves with old school definitions will be crying hoarse, markets is for people who are optimistically poised and understand the full dynamics of the global realties.

      The ability of the market to punish excesses and exuberance mercilessly and overnight is the strength of this market. BSC 9.4% shareholder was turned from a billionaire to a pauper overnight, is this not what we all want to punish those who make mistakes, and are we not addressing the fine print of moral hazard more than adequately, now when these funds want to kill everything in sight than comes the bank of last resort and take those ‘papers ‘which back nearly the other 99% of the American population houses and they do not have exposure to ‘ninja loans’ or subprime problems..

      Lot of carry has been unwounded but yen at 96 with possible 0% rates on the horizon and still no consumer demand will be hard to appreciate any further.
      Mar 19 08:14 AM
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